All international students should file a federal income tax return if they earned money in the US or had a US source scholarship. You should also file a state return if you live in a state that requires it. In the U.S., the Internal Revenue Service oversees the collection of federal income taxes. Non-residents are taxed differently than residents. Students in F or J status are considered to be non-residents for tax purposes until they have been in the U.S. over five calendar years. Non-students in J status are considered to be non-residents for tax purposes until they have been in the U.S. for two years. (Do not confuse the IRS definition of non-resident with the Department of Homeland Security’s definition of non-resident for immigration purposes.)
When You Start a Job: Completing the W-4
If you have been authorized to work, your employer will have you complete a W-4 form, also known as the Employee’s Withholding Allowance Certificate. This determines how much of your income should be paid to the government as taxes. As a non-resident for tax purposes, you may claim only one allowance in item 5 and no further allowances even if you are married and have children. There are exceptions to this rule for citizens of Canada, India, Japan, Korea and Mexico; consult IRS publication 519 for more information. Note that in item 7 on the W-4, you may NOT indicate that you are exempt from taxes.
Each year everyone in F-1, F-2, J-1, or J-2 status is required to file Form 8843, the Statement for Exempt Individuals and Individuals with a Medical Condition, even if you have no U.S. source income. Form 8843 is not a tax form, but rather a tax information sheet that must be submitted to the federal government.
If you have U.S. source income (from working in the U.S., taxable scholarship or dividends on investments in the U.S., for instance), you are also required to file a federal income tax return annually before the April 15 deadline, using either Form 1040NR or 1040NREZ. You may download these forms from the IRS Web site along with instructions. By filing this form, you will determine whether you paid too much, too little, or the appropriate amount of taxes during the previous year. Students who live outside New Hampshire or who have worked outside New Hampshire may also need to file a tax return in that state. By filing the returns, most international students and scholars will receive a refund of overpaid taxes.
Submit with your tax return a W-2 form mailed to you by your employer in January that summarizes your total earnings and taxes withheld. If you receive other U.S. sources income (scholarships or investment income, for example), beginning in January you will receive additional tax documents to submit with your tax return. Be sure to make photocopies of your tax return and all documents submitted before you mail the originals to the IRS.
Tax Treaty Exemptions
The U.S. currently has tax treaties with more than 50 countries. Even if there is a tax treaty with your country, you will still report your income and file a U.S. tax return. These treaties are designed to decrease the likelihood that the non-resident will be taxed on the same income both in the U.S. and the country of tax residency. You should consult IRS Publication 901 which is a summary of tax treaties. Be sure to look at the section that pertains to students to see if you are eligible for benefits. If you think you are eligible, then get an actual copy of the treaty to guide you in completing your tax return.
For More Information
Consult an advisor in International Student Services for basic information about taxation in the U.S. Each spring term, watch for email and posted fliers around campus for free tax help through the SNHU Volunteer Income Tax Assistance (VITA) program.
Please see the IRS Web site at www.irs.gov for further specifics about your responsibilities as a taxpayer, forms, filing instructions and deadlines and late payment options.